The brother of a man killed by a mentally ill former flatmate says not enough is being done to care for mental health patients living in the community - often with tragic results.

Cambridge man Graeme Moyle's older brother, Colin Moyle, was bludgeoned to death in his Auckland home by psychiatric patient Matthew Ahlquist in May 2007.

Mr Moyle's comments come after the Waikato Times reported on the case of an elderly woman who was allegedly sexually assaulted in her home by a mentally ill neighbour.

The woman, who cannot be identified, didn't learn she was living near a residential care facility until after the attack.

The Times understands her alleged attacker was being cared for by Richmond Services, with clinical oversight provided by the Waikato District Health Board's community mental health team.

Mr Moyle said residents had a right to know if they were living next door to people with mental health problems.

"In Colin's case it was a flatmate situation, so it's pretty hard to police, but where there is dedicated housing provided for people with mental illnesses, I think their neighbours have a right to know," he said.

Ahlquist, who was later found not guilty of murder on the grounds of insanity, was released from a psychiatric unit only three months before killing Mr Moyle, despite warnings he was a danger to society.

Mr Moyle said patients' privacy rights were often placed ahead of concerns for public safety. "People say not all mentally ill patients are violent and I totally agree with that, but there are a small portion that are and from my research they are easily identifiable.

"I believe not enough resources are available to care for mental health patients in the community, especially at the higher end. The reason many are on the street is because there's not enough beds for them and there's nowhere to put them."

Waikato District Health Board spokeswoman Kathryn Jenkin said the level of support and clinical oversight for mental health patients was based on each individual's clinical needs.

The frequency of follow-ups was dependent on patients' needs and guided by a "team-based, multidiscipline assessment and management plan".

"Whilst we endeavour to provide the best possible care to service users, we are mindful that despite our best intentions, in any organisation as large and complex as ours, there will be times where things don't go to plan," Ms Jenkin said. "In such situations we will generally formally report serious incidents and undertake a service review to understand what went wrong, and why, in order to improve the services that we provide to those that need them."

Privacy Commissioner Marie Shroff said close neighbours might "fairly wish" to know a residential care facility was nearby. In many instances that fact would be common knowledge in the local community, she said.

Ms Shroff said the interests and needs of all residents in the neighbourhood required adequate support systems to be in place. She also said patients deserved respect and as much lifestyle independence as was reasonable.